SHERIFFDOM OF GLASGOW AND STRATHKELVIN AT GLASGOW
B2135/13
JUDGMENT
by
SHERIFF S. REID, Esquire
Sheriff of Glasgow and Strathkelvin
in the cause
TRUST INNS LIMITED
PURSUER
against
CITY OF GLASGOW LICENSING BOARD
DEFENDER
______________________________
Act: Skinner, Advocate; Millar Campbell, Solicitors, Glasgow
Alt: Blair, Advocate; Glasgow City Council, Legal Services, Glasgow
GLASGOW, 22 January 2014
The sheriff, having resumed consideration of the cause, repels the first plea-in-law for the defender due to want of insistence; Repels the first and second pleas-in-law for the pursuer; Sustains the second plea-in-law for the defender; Refuses the appeal against the defender's decision on 28 June 2013 to revoke the premises licence for premises known as "The Scotch", 14 Gorstan Street, Glasgow; Dismisses the craves of the summary application; Finds the pursuer liable to the defender in the expenses of the appeal as taxed; Allows an account thereof to be given in and remits the same, when lodged, to the auditor of court to tax and report.
Sheriff
NOTE:
Summary
[1] In this summary application, the pursuer appeals against a decision of the City of Glasgow Licensing Board ("the defender") on 28 June 2013 to revoke the pursuer's premises licence for premises known as "The Scotch", 14 Gorstan Street, Glasgow. The appeal proceeds under section 131(1) of the Licensing (Scotland) Act 2005 ("the 2005 Act").
[2] By letter dated 12 June 2013, the Chief Constable of the Police Force of Scotland applied to the defender for a review of the premises licence. The review application narrated inter alia multiple instances of alleged drug misuse on the premises between 10 February 2012 and 30 March 2013. The allegations were said to relate to three licensing objectives, namely, the prevention of crime and disorder (section 4(1)(a), 2005 Act), securing public safety (section 4(1)(b), 2005 Act) and the prevention of public nuisance (section 4(1)(c), 2005 Act).
[3] Having heard submissions the defender found the grounds for review to be established, and thereafter revoked the premises licence with immediate effect.
[4] The pursuer appealed against the defender's decision.
[5] On 21 November 2013, in the exercise of a specific delegated authority from the sheriff principal, I heard full submissions from the parties in relation to the appeal.
The Chief Constable's review application
[6] The Chief Constable's review application (item 6/1 of process) narrated a number of drug related allegations, namely:-
1. On 10 February 2012 at 8.05 pm, in the course of a routine police inspection of the premises, a male patron was detained in the male toilets within the premises and found to be in possession of a knotted plastic bag containing four smaller bags with white powder within (weighing 0.6g, 0.8g, 0.7g and 0.7g). The powder tested positive for cocaine.
2. On 3 March 2012 at 10.05 pm, in the course of a routine inspection of the premises, white powder was found on the sink basins within the male toilets serving the bar area. Staff were informed of the discovery and were requested by the police to increase toilet checks.
3. On 3 August 2012 at 1.00 pm, during a routine inspection of the premises, police discovered the remnants of two wraps (said to be consistent with those used for cocaine) on top of a toilet cistern within the toilets serving the lounge area.
4. On 3 August 2012 at 5.55 pm, upon re-attending the premises to carry out a further inspection, police detained two males found within the toilets. One male was observed to drop four bags of white powder onto the toilet floor (weighing 3.6g in total). This male was the son of the former tenant's operations manager. A further bag of white powder (weighing 0.9g) was found in the possession of the second male. The powder tested positive for cocaine. Both males were arrested. On 16 October 2012 at Glasgow Justice of the Peace Court, one of the males was convicted of possession of a controlled drug.
5. On 4 August 2012, in the course of a routine inspection of the premises, police discovered a line of white powder on a toilet seat within the toilets serving the bar area. No patrons were within the toilet area at that time.
6. On 31 December 2012 at 9.50 pm, in the course of a routine inspection of the premises, police found a patron within the toilets in possession of a bag of white powder (weighing 0.4g). He was observed with a rolled up £10 note in his hand, dusting white powder off the top of a toilet roll dispenser. The powder tested positive for cocaine.
7. On 19 January 2013 at 7.00 pm, in the course of a routine inspection, the police checked all surfaces within the female toilets in the lounge area. The surfaces were checked with cocaine wipes, during which, one toilet seat cover proved positive for traces of cocaine. Staff were made aware of the finding.
8. On 25 January 2013 at 6.50 pm, in the course of a routine inspection, the police checked all surfaces within the female toilets in the lounge area. The surfaces were checked with cocaine wipes, during which, one surface proved positive for traces of cocaine.
9. On 30 March 2013 at 9.20 pm, in the course of a routine inspection, police officers found, in the male toilets, two beer mats with traces of white powder on them.
[7] The review application also narrated a number of non-drug related allegations, namely:-
1. On 1 January 2012 at 1.00 am, an intoxicated male patron was asked to leave the premises, an argument ensued with staff, the patron broke a window by throwing a bottle, the police were called by the staff and the staff co-operated throughout.
2. On 4 February 2012 at 9.50 pm, a fight took place between patrons within the premises, the police were called by ambulance crew (not by the staff of the premises), and the staff were alleged to have been uncooperative in the police investigation of the incident.
3. On 6 April 2012 at 5.45 pm, the DPM deliberately obstructed the police by failing to provide the police, on request, with footage from the CCTV system within the premises (in relation to an alleged incident at a nearby supermarket).
4. On 7 April 2012 at 6.15 pm, in the course of a routine inspection, an intoxicated male patron refused to leave the premises, when requested to do so, and was subsequently arrested and issued with a fixed penalty notice. The CCTV within the premises was noted to be no-operational.
5. On 15 July 2012 at 1.00 am, an intoxicated male patron refused to leave the premises when requested to do so; once outside, he began to kick a shutter at the rear of the premises and wrapped a belt around his hand; the police were called by the staff; it was alleged that the staff sought to diminish the seriousness of the situation.
6. On 23 September 2012 at 11.30 pm, an assault was carried out on a male patron within the bar area; the assailant was allowed by staff to return to his seat within the bar area, and the staff did not report the incident to the police.
7. On 24 September 2012 at 12.35 am, patrons were still within the premises after closing time.
8. On 12 January 2013 at 10.55 am, police officers attended at the premises to execute a warrant authorising a search of the premises for evidence pertaining to alleged breach of copyright (involving the alleged unlicensed broadcasting of live Sky football footage).
9. On 10 January 2013, a staff member failed to produce a personnel licence on request, and was cautioned and charged.
[8] Lastly, the review application narrated three so-called "interventions" by the police, whereby formal meetings took place at London Road Police Office with representatives of the premises licence holder and others, during which police concerns regarding the operation of the premises were discussed, and certain police recommendations were agreed by relevant parties. Specifically:-
1. On 9 August 2012 a first intervention took place within London Road Police Office attended by two police officers, the Licensing Standards Officer ("LSO"), representatives of the pursuer (as the premises licence holder) and the then tenant of the premises (Urban Holding Limited) and the designated premises manager ("DPM"). At this meeting the following recommendations were proposed by the police, and agreed on behalf of the pursuer and the DPM: (i) with immediate effect, a system of checking the toilets within the premises was to be commenced for signs of drug misuse; (ii) the use of the toilet by certain patrons was to be monitored more closely (having regard inter alia to the number of persons entering and frequency of such visits); (iii) any concerns about drug dealing were to be reported immediately to the police; (iv) the premises licence holder and DPM were to ensure that CCTV was fully operational at all times; (v) a "zero tolerance" policy was to be adopted to persons taking drugs on the premises, specifically all persons caught on the premises taking drugs were to be excluded and recordings kept within an incident/refusal book.
2. On 26 September 2012, a second intervention took place within London Road Police Office attended by two police officers, the DPM and a representative of the then tenant (Urban Holding Ltd) at which the following police recommendations were agreed, namely, (i) that management were to report incidents at the earliest opportunity in the interests of public safety; (ii) that management were to co-operate fully with police enquiries; (iii) that staff training was to be implemented regarding the management of incidents; and (iv) that staff were to monitor levels of drunkenness within the premises.
(No representative of the pursuer was able to attend this second intervention, but a representative did attend the police office on 28 September 2012 and was fully advised of the content of the intervention. The review application recorded that, on that occasion, the pursuer's representative stated to police that the current managers of the premises would be removed over the coming months. As at the date of the review application, no such change had been effected.)
3. On 11 January 2013, a third intervention took place within London Road Police Office attended by two police officers and a representative of the pursuer. The DPM was unable to attend. The previous recommendations made at the second intervention were said to have been re-emphasised and agreed by all parties present with the following additional recommendation, namely, that "management were to be in full control of operating practices and all aspects of the premises and conditions adhered to".
[9] The review application concluded inter alia that the premises were operating in a manner likely to cause serious harm to the public by allowing the continued use of controlled drugs within the premises; that the premises management had been spoken to over a considerable period of time, made fully aware of the ongoing issues in respect of drug misuse within the premises, and had taken little action to resolve the issue.
[10] The Chief Constable requested that the premises licence be revoked on the basis that those with responsibility were either unable or unwilling to operate the premises in line with the licensing objectives.
The review hearing
[11] On 28 June 2013, a review hearing took place. The pursuer was represented by a solicitor. A copy of the transcript of the review hearing held on 28 June 2013 is produced (item 6/2 of process).
[12] For the pursuer, the pursuer's solicitor took issue with some (but not all) of the non-drug related allegations. As for the remaining incidents of disorder, no objection was taken to the truth of those allegations but, it was submitted, they did not represent "a considerable number of incidents" (Transcript, page 43, lines 22-25 and page 44, lines 1-15.)
[13] As for the drug related allegations, again the pursuer's solicitor did not challenge the factual narration of each of the alleged incidents. Instead, the pursuer's solicitor submitted that on only a "very, very few occasions" had the police found evidence of drugs on the premises (being, by her calculation, six or seven incidents out of 170 police checks in the stated period) (Transcript, page 50, lines 14 to 24; and at page 52, lines 3 to 4: "So the fact of the matter is, six incidents out of 170 [visits] - this is not a drug den").
[14] It was specifically disputed that the premises condone the use of drugs. It was submitted that drug misuse was "a countrywide problem", and, specifically, a problem in the local area. (Transcript, page 52, lines 17 to 18: "[The premises] do not have a drug problem. The area has a drug problem..."). Reference was made to an article in the Sunday Post newspaper dated 24 February 2013 bearing to record the alleged outcome of "drug wipe" tests by a Sunday Post journalist within various public buildings, including the Scottish Parliament, the Sheriff Courts in Edinburgh and Glasgow, and the National Museum of Scotland (Transcript, page 36, lines 2 to 12; & page 42, lines 5 to 8).
[15] It was submitted that the pursuer and the management had done all that could reasonably be expected of them, specifically by fully complying with the recommendations accepted at the three police interventions. Reference was made to a folder of extensive documentation bearing to record frequent toilet checks; monitoring of patrons; exclusion of patrons from the premises; the display of anti-drug posters within the premises; the removal of flat surfaces within the toilet areas (such as toilet seats, cistern lids and toilet roll holders) to minimise drug misuse; the smearing of toilet surfaces with baby oil; policies relating to CCTV, staff training and "zero tolerance" of drug use; more recently, the purchase and use of torches (to assist in searches of the toilets for drug misuse) and the introduction of "drug wipes" to detect drug use within the toilets; and the retention of experienced trained staff. It was submitted for the pursuer (Transcript, page 29, line 23 to page 30, line 9):-
"One of the difficulties... is that short of literally standing in the cubicles with people, there is only so much they can do. They can't put CCTV in the toilets. ...so they have genuinely tried all of the avenues that have been suggested by the police and they genuinely have tried additional avenues as well".
[16] The pursuer's agent submitted that the premises licence should not be revoked or suspended because the licence holder and management had "gone above and beyond" what was required of them by the police in carrying out steps to prevent drug misuse (Transcript, page 41, lines 10 to 13). Revocation was inappropriate given all of the actions taken by the management to date and the information regarding the future management of the premises.
The defender's decision and statement of reasons
[17] Having considered matters, the defender concluded that grounds for review had been established, and that it was necessary and appropriate (for the purposes of the licensing objectives of preventing crime and disorder, securing public safety, preventing public nuisance and protecting children from harm) that the premises licence be revoked with immediate effect.
[18] In its statement of reasons dated 19 July 2013 (item 6/3 of process), the defender recorded its conclusion that there was a continued pattern of drug misuse within the premises; that that pattern was significant and serious; that it demonstrated a clear and considerable departure from the reasonable and proper standards of operation of licensed premises; and that the foregoing licensing objectives had thereby been compromised.
[19] As regards the appropriate disposal, the defender concluded that the pursuer had failed adequately to tackle the problems associated with drugs misuse on the premises; that the premises had become "a focal point for drug misuse over a significant period of time"; that, "despite all of the measures purported to have been put in place, the situation would not substantially improve if the premises were permitted to continue to operate"; that those in a position of responsibility had shown themselves to be either unwilling or unable to operate the premises in line with the licensing objectives; that the continued misuse of drugs within the premises could not be permitted to continue; and therefore, acting in the public interest, revocation of the premises licence with immediate effect was the appropriate disposal.
The Appeal Hearing
[20] The pursuer appealed against the defender's decision. The appeal called before me on 21 November 2013.
[21] Both parties were represented by counsel. Written submissions, and an agreed joint bundle of authorities and related process papers, were helpfully provided by counsel and the parties' agents, for which I am grateful.
Submissions for the pursuer
[22] The pursuer's submissions can be summarised as follows.
[23] As a preliminary matter, the pursuer's counsel sought to amend article 5 of condescendence by inserting the following averment at the end of the article: "Esto [the defender] took said report into account, they breached natural justice by failing to disclose it to the pursuer". The motion was opposed. I allowed the amendment under reservation of the question of expenses.
[24] The pursuer's counsel then circulated his written submission. Firstly, he submitted that the report of the Licensing Standards Officer ("LSO"), provided to the defender for the Hearing on 28 June 2013, was not a valid report "on the application", for the purposes of section 38(4)(a) of the 2005 Act (see page 7, pursuer's written submission). The defender should have refused to consider the application in the absence of a proper report. By proceeding with the review hearing, and by taking account of the invalid LSO report, the defender had erred in law et separatim exercised its discretion unreasonably.
[25] The defender's counsel objected to this line of argument on the basis that there was no foundation on record for the submission. The pursuer's counsel submitted that it was adequately disclosed in the amended pleadings.
[26] Having heard submissions on the point, I disallowed the line of argument. In my judgment, there was no foundation, and no adequate notice, on record for the submission. Indeed, the submission was the antithesis of the pursuer's averred position. Contrary to the pursuer's position on record (article 5 of condescendence), the pursuer was now seeking to argue, not that the defender was obliged to take the LSO report into account (and had failed to do so) (as is averred in article 5), but that the defender was obliged not to take the report into account (but had done so). Inexplicably, the argument had not formed part of the amendment that had been sought, discussed and granted at the outset of the appeal hearing, prior to the tendering of the pursuer's written submission (per para. [23], above). No further motion to amend was made for the pursuer. Lastly, no adequate explanation had been provided for the failure to give proper notice of it, not least as the LSO report had been lodged in process as far back as 7 November 2013 (and was available to the pursuer's counsel long before then). In my judgment, the defender and the public interest were likely to prejudiced by allowing the late introduction of this line of argument because an adjournment would have been required - and delay occasioned - in order to allow the defender adequate time to respond to what would, in practical effect, have been a new ground of appeal.
[27] Secondly, the pursuer's counsel submitted that esto the LSO report was a valid report, the defender had failed to take it into account; that the LSO report was, by statute, relevant material; and that a failure to take relevant material into account constituted both an error of law and an unreasonable exercise of discretion (per article 5 of condescendence). Reference was made to Loosefoot Entertainments Ltd v Glasgow Licensing Board 1991 SLT 843 at 846C; Ritchie v Aberdeen City Council 2011 SC 570 at paragraphs 11 & 12. Extending the argument, the pursuer's counsel submitted that even if the defender had taken account of the LSO report, the statement of reasons did not disclose that it had done so, and certainly failed to disclose any evaluation of the LSO report. The pursuer's counsel submitted that the content of the LSO report might have supported the submission (and inference) that the premises were, in fact, not as bad as was claimed by the Chief Constable.
[28] Thirdly, the pursuer submitted that, esto the defender took account of the LSO report, the defender breached principles of natural justice by failing to disclose the report to the pursuer. I was advised that the report was first intimated to the defender in August 2013 (after the appeal to the sheriff principal had been lodged). The 2005 Act contained no express requirement for intimation of the LSO report to the premises licence holder. Nevertheless, the pursuer's counsel submitted that it was reasonably implied that such disclosure required to be made. By failing to disclose the report prior to making its decision, the defender acted contrary to natural justice by preventing the pursuer's agent from considering, and from making submissions upon, the LSO report (Freeland v City of Glasgow Licensing Board 1979 SC 226; McDonald v Western Isles Council 2001.)
[29] Fourthly, the pursuer submitted that, in revoking the licence, the defender exercised its discretion unreasonably by failing to take due account of, and to have proper regard to, the facts that, since the incidents complained of, a new and highly experienced tenant had taken over the lease of the premises; that since the new tenant had taken entry, there had been no further incidents of drug misuse on the premises; that trace levels of controlled drugs, indicative of drugs misuse, were present in wider society (including in public buildings such as the Scottish Parliament, Glasgow Sheriff Court and the National Museum of Scotland); and that the number of drug "finds" was relatively low. Given that the sanctions available to the defender were essentially "forward looking" (Lidl (UK) GMBH v City of Glasgow Licensing Board 2013 SCIH 13 at paragraph 35), and not punitive, the pursuer submitted that the defender had erred in deciding to revoke the licence, by failing to have proper regard to the foregoing material. Linked to this, it was also submitted that the defender had erroneously extrapolated merely from the number of police visits to the premises that the premises had become a focal point for criminality within the community (per article 6 of condescendence).
[30] Fifthly, the pursuer's counsel submitted that, by basing its decision in part upon the licensing objective relating to the protection of children, the defender had acted contrary to natural justice because it had founded upon material that was not disclosed to the pursuer. Specifically, the defender's statement of reasons recorded that the defender had relied upon its own "local knowledge" and "evidence presented to [the defender] at its policy development evidence sessions" that the standard licence condition that children should be accompanied by an adult in licensed premises "may not always be adhered to", especially in toilet areas. The pursuer's counsel submitted that the defender's so-called "local knowledge", and the content of these "policy development evidence sessions", should have been put to the pursuer to allow the pursuer to comment upon it. The failure to do so amounted to a breach of natural justice (Freeland, supra; McDonald, supra). There was also said to be no adequate evidential basis for the defender's conclusion that children had ever been exposed to drug taking in the premises or would be likely to suffer harm because of "drugs paraphernalia".
[31] I was invited to uphold the appeal and to reverse the Board's decision. It was submitted that it was not safe to remit the matter to the defender. (The pursuer's counsel submitted that it was not possible for the City Council to convene a differently constituted Board). If I was not minded to reverse the decision, I was invited to remit the matter to the defender for fresh consideration.
Submissions for the defender
[32] The defender's preliminary plea was not insisted upon. In reply to the substantive submission, the defender's counsel submitted, firstly, that the LSO report was, in essence, a "no comment" report and therefore of no material significance; there was no obligation on the defender to formally record that it had been taken into account; and, even if it had not been taken into account, on any reasonable view, the report could have had no material bearing on the ultimate issue before the defender or upon the disposal of the review application.
[33] Secondly, counsel submitted that there had been no breach of natural justice in failing to disclose the LSO report to the pursuer prior to the defender's decision. The pursuer and its agents must have known that the report was available; it was open to the pursuer's agent to request disclosure of it or of its contents; but that there had been no such request. Even if there had been a technical breach of principles of natural justice in failing to disclose the LSO report, that breach could have had no material bearing upon the outcome given the neutral terms of the report.
[34] Thirdly, it was submitted that, contrary to the pursuer's averments, the defender did have proper regard to the change in the identity of the tenant. The assessment of the weight to be attached to that consideration was a matter for the defender and the defender's conclusion in that respect was not unreasonable. Reference was made to Hughes v Hamilton District Council 1991 SC 152; Ritchie v Aberdeen City Council 2011 SC 570; Ranachan v Renfrew District Council 1991 SLT 625, Latif v Motherwell District Licensing Board 1994 SLT 414 and Pulhofer v Hillingdon London Borough Council [1986] AC 485 at 518 E-F.
[35] Fourthly, the defender argued that it had not acted contrary to natural justice in basing its decision upon the licensing objective of protecting children. While the statement of reasons did indeed refer to the defender's "local knowledge" and to evidence presented to the defender at its "policy development evidence sessions", this was immaterial because the essential concern (i.e. that there was a risk that children might enter toilet areas unsupervised by an adult and stumble upon evidence of drug misuse) was adequately ventilated at the hearing. The decision in Freeland (supra) was distinguished. Reference was made to Catscratch Ltd (No. 2) v City of Glasgow Licensing Board 2002 SLT 503 and Coyle v Glasgow City Council 2012 SCIH 33. There was said to be no "ambush" in the present case.
[36] Fifthly, the defender's counsel submitted that the defender had not failed to have regard to material facts, nor had the defender reached a conclusion which was not properly available to it, on the material presented.
[37] Sixthly, in deciding to deploy the sanction of revocation, it was submitted that the defender was, again, entitled to reach the conclusions, on the material available to it, that there was a culture of drug misuse upon the premises, created over a prolonged period; that the steps that had been taken by the pursuer to date, and that were proposed to be taken in the future, were inadequate, and unlikely materially to improve the position within a reasonable period; and that "a line had been crossed". Those conclusions could not be characterised as unreasonable or unsupportable.
[38] I was advised by the defender's counsel that it was a matter of agreement that no submission was being made by the pursuer in support of the averments in article 7 of condescendence.
[39] Lastly, if I was minded to allow the appeal, the defender's counsel invited me to remit the review application to a differently constituted Licensing Board. He confirmed that a differently constituted Board could indeed be convened, and would be convened if the interlocutor so required. Reference was made to Matchurban v Kyle and Carrick District Council 1995 SLT 505 and Brightcrew v City of Glasgow Licensing Board.
Supplementary submissions for the pursuer
[40] In response to the defender's submissions, counsel for the pursuer made the following supplementary submissions.
[41] Firstly, he explicitly acknowledged that he was not suggesting that there was no basis whatsoever for the defender to hold the grounds for review to be established. Instead, he was taking issue with "how [the defender] had dealt with the material before them and the gaps in their reasoning" (see written submission for pursuer, page 11, lines 2 to 5).
[42] Secondly, I was referred to pages 21 and 25-29 of the Transcript detailing the multiple steps that were being taken by the pursuer to address the issue of concern.
[43] Thirdly, he disputed the contention that the LSO report was only disclosable upon request. He explained that some LSOs around the country are not prepared to discuss the content of their report with licence holder's agents. This difficulty can be avoided if, as he submitted, I was to imply an obligation upon Licensing Boards to disclose the LSO report.
[44] Finally, I asked the pursuer's counsel to clarify whether the pursuer was conceding that there was a factual basis for the defender's conclusion that drugs misuse was taking place on the premises. The pursuer's counsel stated that he reserved his position on that matter. Separately, I asked for clarification from both counsel as to the precise number of occasions on which evidence of drug use had been identified by the police on the premises. The defender's counsel had referred to 10 occasions of drug "finds" in his written submission (but appeared to concede at the bar that the correct number was nine). The pursuer's counsel submitted that there were only eight such occasions. The discrepancy (between eight and nine drug "finds") appeared to relate to the incident on 30 March 2013 in which white powder was found on two beer mats in the male toilets. In relation to that allegation, the pursuer did not dispute the factual content of the allegation, but took the view that the white powder had not been identified as a controlled drug, and did not concede any such inference therefrom.
Discussion
[45] The Chief Constable's review application narrated nine alleged incidents bearing to disclose evidence of drug misuse on the premises; five alleged incidents of public disorder; five alleged incidents of non-cooperation by staff with the police investigation of crime; one alleged incident of operating beyond permitted hours; one alleged incident of a staff member failing to produce statutory documentation on request; and one alleged incident pertaining to the suspected breach of third party intellectual property rights.
[46] The alleged incidents of public disorder, staff non-co-operation, and alleged breaches of intellectual property rights, licence conditions and statutory obligation do not feature (either at all or to any material extent) in the defender's decision. Instead, properly interpreted, the defender's decision turns upon the allegations of drug misuse on the premises and the history of police interventions over the period from 10 February 2012 to 30 March 2013.
[47] Importantly, the pursuer did not seek to dispute the factual findings of the police (as narrated in the review application) in relation to each of the nine drug related allegations. Instead, all that the pursuer sought to dispute (at both the review hearing before the defender and the appeal hearing before me) was the assessment of the material, specifically the weight to be attached to it, and the inferences and conclusions to be drawn from it.
[48] Viewed in that context, in my judgment a substantial part of the present appeal falls within the binding dicta in Ranachan, Hughes and Latif, supra.
[49] In short, once there is relevant material before a licensing board (as, indubitably, there was on this occasion), the question as to the weight to be attached to that material, and the significance of it, is one for the licensing board. It is not for the sheriff, on appeal, to substitute his or her own views and interpretation of the evidence for that of the licensing board, upon whom that function has been entrusted by statute, unless, of course, the licensing board's conclusion is vitiated by error or is otherwise one which no reasonable board could have reached. The general approach to fact-finding in administrative decision-making, as summarised in Pulhofer, supra (at page 518 per Lord Brightman), is apt in the present context:-
"Where the existence or non-existence of a fact is left to the judgment and discretion of a public body, and that fact involves a broad spectrum ranging from the obvious to the debatable to the just conceivable, it is the duty of the court to leave the decision of that fact to the public body to whom Parliament has entrusted the decision-making power, save in a case where it is obvious that the public body, consciously or unconsciously, is acting perversely".
[50] Echoing the dicta in Latif, supra (at page 415), the defender, in the present case, has the advantage of hearing many such applications, it knows its own area, and it may be assumed to have developed some expertise in assessing problems such as drug misuse on licensed premises. Accordingly:
"The appropriate test...is to consider whether 'a reasonable board', rather than 'a reasonable person', would have adopted the course taken by the [the defender] in this case,"
[51] Further, where, as here, a licensing board is presented with multiple alleged incidents, it is entitled to consider the cumulative picture that emerges from the material before it and to attach such weight as it considers appropriate to the overall cumulative effect of the number and type of incidents before it (McKay v Banff & Buchan Western Divisional Licensing Board 1991 SLT 20.)
[52] In the present case, the defender had before it undisputed material indicative of drug misuse on the premises on eight occasions in the period from 10 February 2012 to 25 January 2013; with a further incident on 30 March 2013 disclosing findings from which, viewed in context, the inference was reasonably capable of being drawn of further drug misuse; that these nine incidents occurred in the context of three formal police interventions in the management of the premises (on 9 August 2012, 26 September 2012 and 11 January 2013); and that evidence of drug misuse on the premises continued to be detected, notwithstanding the interventions and steps taken by the tenant; and that a new tenant, and certain further action, had only recently been introduced. The defender had other relevant material available to it, including a professional assessment of the operation of the premises from a policing perspective (see paragraph [56], below). The assessment of the whole material before it was entirely a matter for the defender. Put shortly, the defender's assessment was that the undisputed incidents, viewed cumulatively, were serious; that they were indicative of the premises having become a focal point for drugs misuse over a significant period of time; that the pursuer had done too little, too late to address the issue of drugs misuse on the premises; and that the pursuer's proposed future actions were unlikely significantly to improve matters within a reasonable period of time.
[53] Others may disagree with those assessments. Another board, on another day, might have reached different conclusions. But it is nothing to the point. In my judgment, in the context of determining, firstly, whether the grounds for review were established and, secondly, which statutory "step" was "necessary and appropriate" (s.39, 2005 Act) the defender's conclusions on the facts were conclusions that it was entitled to reach on the relevant material before it; they were factual conclusions that fell within the broad spectrum of possible conclusions ("ranging from the obvious to the debatable to the just conceivable": per Pulhofer, supra, at page 518) that a reasonable board, properly informed, might have reached; they were factual conclusions that were not tainted by any material error or misdirection; and the defender did not fail to consider relevant evidence or submissions that might have pointed in a different direction.
[54] Addressing each of the pursuer's specific criticisms in more detail, firstly, the pursuer submitted that the defender failed to take due account of "the prevalence of drugs within Scotland" (per article 9 of condescendence), including "the widespread prevalence of traces of drugs in major public buildings" (per pages 12 & 13 of the pursuer's written submission) in concluding that the premises had become a focal point for criminality in the local community. In my judgment, this submission is not well-founded. The evidential basis for the submission (that drug misuse, and traces of controlled drugs, are prevalent, including in major public buildings) appears to be a clipping from the Sunday Post newspaper. The statement of reasons explicitly records that the defender did consider this material (and the submission relating to it). The assessment of the weight to be attached to it was entirely a matter for the defender. It can reasonably be inferred from the statement of reasons that the defender decided to attach little weight to it. It explained why. The defender's reasoning was that, while it acknowledged that there may be a wider drug issue with the local community, its duty was to consider whether one or more of the licensing objectives had been compromised in relation to these particular premises. That explanation cannot be faulted. It cannot be said that no reasonable board, properly informed, could have reached that decision. It is not difficult to conceive of other reasons why little weight might be attached to the newspaper clipping (the presentation of which was itself described by the pursuer's own agent as partly "tongue in cheek": Transcript, page 36, line 4), or to the related submission, but, that apart, the defender's assessment discloses no patent error.
[55] Secondly, the pursuer submitted that the defender had failed to have proper regard to the "very low percentage of times" that any trace of drugs was found on the premises, compared with the large number of police visits to the premises. In my judgment, that submission is not well-founded. The statement of reasons explicitly records that the defender did consider this comparative material. The assessment of the weight to be attached to it was a matter for the defender. It decided that the number of finds in the relevant period was significant, serious and represented evidence of continued pattern of drugs misuse at the premises (see statement of reasons, page 4, penultimate paragraph). That was an assessment that fell peculiarly within the province of the defender as the licensing authority. It cannot be said that no reasonable board, properly informed, could have reached that decision.
[56] Thirdly, the pursuer submitted that the defender had erroneously equated the number of police visits (170) with the number of drug finds (nine) or had erroneously inferred from the number of police visits that the premises were a focal point for criminality. The statement of reasons does indeed refer to the number of police visits, but it is not correct to conclude that the defender has equated the number of visits with the number of drug finds. The two facts are distinguished. Moreover, the defender does not base its conclusion (that the premises had become a focal point for criminality) solely upon the number of police visits. Instead, the defender explicitly founds its decision, in part, upon information supplied on behalf of the Chief Constable that the premises "present the biggest problem to the police" within the local area (see statement of reasons, page 4, paragraph 1). Properly interpreted, what this material amounts to is a professional and informed assessment, from a policing perspective, of how the operation of the premises compares with others in the local area, having regard to the number of visits (170), the number of drug finds (nine, of which one is circumstantial), the number of formal police interventions (three), and the persistent ongoing detection of drug misuse thereon notwithstanding this level of supervision and intervention. The defender was entitled to have regard to that professional assessment, and to attach such weight to it as it considered appropriate. The defender cannot be said to have misdirected itself. Nor can it be said that no reasonable board, properly informed, could have reached the same conclusion. The pursuer falls into error by seeking to isolate, and to misinterpret, just one element of an overall police assessment of the premises.
[57] Fourthly, the pursuer submitted that the defender failed to have proper regard, or to give due weight, to the fact that a new and highly experienced tenant had taken over the lease of the premises. In my judgment, this submission is not well-founded. Firstly, the statement of reasons explicitly records that the defender did consider this issue. The defender was fully aware that a new tenant had recently been appointed. Indeed, the new tenant addressed the defender personally. Secondly, the assessment of the weight to be attached to that material (both in the context of determining, firstly, whether a ground for review was established and, secondly, which statutory "step" was "necessary and appropriate") was a matter for the defender. The defender explicitly concluded that the change of tenant (which had occurred on 29 April 2013, only two months prior to the review hearing) "came too late to alter an established culture of drug misuse within the premises" (statement of reasons, page 6, paragraph 4); that the steps put in place by the new tenant would not be "sufficient in adequately reversing the pattern and culture of drug misuse" (statement of reasons, page 6, paragraph 5) created over a preceding lengthy period; that the premises having become a "focal point for drugs misuse over a significant period of time", despite all the measures said to have been put in place, "the situation would not substantially improve" if the premises were permitted to continue to operate (statement of reasons, page 6, paragraph 6); and that the drugs misuse on the premises would not be "capable of being resolved in the near future owing merely to the presence of the new leaseholder" (statement of reasons, page 6, final paragraph 7). These were assessments that fell peculiarly within the province of the defender as the licensing authority. It cannot be said that no reasonable board, properly informed, could have reached those conclusions on the material available.
[58] One particular step introduced by the new tenant - the use of drug wipes - was much-trumpeted by the pursuer's solicitor at the review hearing. She submitted (Transcript, page 58, line 17 et seq):
"...my submission to you is that they [the pursuer] have taken steps and the situation is drastically improving. They cannot solve it overnight. They have tried to take all possible steps and it's my submission to you to give them a chance to allow the fact that they are now using drug wipes which the patrons all know about ....time to work through, and we are asking for time to take the further step and carry that out."
The statement of reasons discloses that the defender was unimpressed. It explained why. Aside from the belated timing of its introduction (only three or four weeks prior to the review hearing: see Transcript, pages 62 to 63), the defender concluded that drug wipes were principally an aid to detecting drug use, but that they "do not hold any particular deterrence value" in themselves, and would not be sufficient to reverse the established pattern and culture of drug misuse on the premises (statement of reasons, page 6, paragraphs 4 & 5). Linked to this, the defender had already concluded that, over a lengthy period, the number of recorded exclusions of patrons from the premises (initiated by the premises management, rather than the police) was relatively low, from which the defender had inferred a lack of ability or resolve to tackle drug misuse on the premises (statement of reasons, page 5, paragraph 2). Each of these factual conclusions fell within the broad range of conclusions that a reasonable board could properly reach. On the material before it, the defender was entitled to reach each and all of them. The defender did not misdirect itself in any substantial respect.
[59] It was in the context of this submission that the pursuer founded upon the decision of the Inner House in Lidl, supra. It was submitted that, since the review process was essentially "forward-looking", the defender had failed to have proper regard to each of the foregoing factors (including the introduction of the new tenant). In my judgment, that submission is not well-founded. Having concluded that the grounds for review were established in relation to the drug related allegations, the defender correctly applied its mind to the second stage of the statutory process, by considering which "step" was "necessary or appropriate" for the purposes of the licensing objectives". In so doing, on a proper reading of the statement, the process adopted by the defender was indeed essentially "forward-looking". The pursuer had explained the steps it had taken, and proposed to take, to address the issue of drug misuse on the premises. However, the pursuer had given no clear estimated timescale for the problem to be resolved. It merely acknowledged that it would not be solved overnight. For its part, the defender had made an assessment of the nature of the perceived drug problem within the premises; it had made an assessment of the value and efficacy of the pursuer's remedial actions; and it also considered whether (and when) the situation was likely to improve. The defender concluded that the situation was not likely significantly to improve within a reasonable time. Its reasoning can be discerned from the statement. The culture of drug misuse was so embedded, and the steps taken to date had been so ineffective, that the belated recent introduction of a new tenant, drug wipes and torches would not resolve matters "in the near future". In other words, the defender was having to contemplate the unattractive prospect of allowing the premises to continue to operate in a manner that envisaged ongoing drug misuse while the pursuer's efforts (which had singularly failed to eliminate the pattern and culture of drug misuse) hopefully worked through. In that context, the defender was indeed having proper regard to how the licensing objectives would be achieved in the future.
[60] On its facts, of course, the Lidl decision is markedly different from the present case. In Lidl, the licensing board was faced with an "isolated" failed test purchase, with no "intelligence or information" of any previous under-age sales and with no repetition of the failure after the single incident complained of; a prompt and decisive management response to the failure; and an otherwise unimpeachable policy and procedure to prevent under-age sales. In contrast, the present case involves a protracted history of persistent drug misuse on the premises (extending over 13 months); three formal police interventions; a tardy response by management to evidence of ongoing drug misuse, specifically, the belated introduction of logged toilet checks in August 2012, the belated use of drug wipes and torches, and the belated removal of the tenant (the DPM remaining in office throughout); and other identified shortcomings in management practices, specifically in the implementation of its exclusion policy. Against that background, the defender's decision in the present case to revoke the premises licence did not constitute a punishment, but rather a necessary and appropriate step to further the licensing objectives.
[61] Fifthly, the pursuer submitted that the defender failed to take due account of the fact that there had been no further recorded incidents of drug misuse since the change of tenancy. It is correct that the statement of reasons makes no explicit reference to this issue. That is not surprising. It did not feature significantly in the submissions at the review hearing. Nevertheless, the defender was entitled to proceed on the basis of the substantial material then available to it. There was no undue passage of time between the allegations contained within the review application and the consideration of those allegations at the review hearing such as to render the allegations historic or stale. Besides, the defender had before it a sufficiently recent, detailed and extensive body of evidence bearing upon the operation of the premises, drawn over a sufficiently lengthy period of time, to enable it to reach an informed decision on the extent to which a "pattern and culture of drug misuse" had become embedded within the premises, and the likely effect upon that culture of the recent introduction of the new tenant.
[62] For completeness, it is worth noting that in the present case the defender concluded, and stated explicitly, that the pursuer's delay in implementing a more robust and pro-active approach to the repeated drug misuse on the premises had led to the establishment of a drug culture within the premises (statement of reasons, page 6, paragraph 2). In other words, some element of culpability was attributed by the defender to the pursuer for the problems facing the premises. Nevertheless, even if it could have been argued that the pursuer had timeously taken all practicable steps available to it (which, clearly, the defender concluded was not the case here) it would have been open to the defender to conclude, on the material available to it, that, through no fault of the pursuer, the premises had become blighted by criminal or nuisance behaviour, thereby jeopardising compliance with the licensing objectives, and justifying revocation of the licence (Surrey Heath Council v McDonald's Restaurants Ltd [1990] 3 LR 21; Lidster v Owen [1983] 1 WLR 516). That is because the licensing objectives are not fault-based. They seek to protect and promote a wider range of public interests, quite distinct from issues of fault, blame or culpability.
[63] Sixthly, the pursuer submitted that the defender had failed to take account of the LSO report; and that, even if the defender had taken account of the report, the statement of reasons did not disclose that it had done so (or otherwise explain the defender's evaluation of the report). In my judgment, this submission is not well-founded. It is correct that the statement of reasons does not formally record that the LSO report had been taken into account, nor does it record any particular evaluation of the content of the report. However, again, in the circumstances of this case, that is unsurprising. The LSO report is brief and uninformative. It merely confirms the LSO's attendance at two of the recorded police interventions. The report can reasonably be concluded to have been of little probative value (beyond corroborating two of the interventions referred to in the review application) and to have been of no material significance to the defender's decision. In short, it adds little, if anything, to the body of material presented to the defender. Merely because statute requires that the LSO must prepare and submit a report to the licensing board, and that the licensing board must take the report into account at the review hearing (section 38(4), 2005 Act) does not mean that the content of the report in any particular case is of any material evidential value or determinative significance.
[64] Further, in fulfilling its duty to give proper and adequate reasons, a decision-maker, such as the defender, need not engage in an elaborate and detailed evaluation of each and every point that has arisen at the hearing (Ritchie v Aberdeen City Council 2011 SC 570). The statement of reasons must identify what the defender has decided to be the material considerations; it must clearly and concisely set out its evaluation of them; and it must set out the essence of the reasoning that has led the defender to its decision (Ritchie, supra). It is plain, from the brief, uninformative terms of the LSO report, that it is of no probative significance, and has not formed a material consideration in the defender's decision. In fulfilling its obligation to give adequate reasons, the Board does not require to specify and evaluate every submission or adminicle of evidence that has been presented to it. Accordingly, neither the failure to explicitly refer to the LSO report, nor to record its evaluation of the report, constitutes an error of law or an unreasonable exercise of discretion.
[65] Seventh, the pursuer submitted that the defender breached principles of natural justice by failing to disclose the LSO report to the pursuer. In my judgment, that submission is not well-founded. While the 2005 Act makes no explicit provision for the disclosure of the LSO report to the premises licence holder, nevertheless, in compliance with principles of natural justice, the content of the report would require to be divulged to the premises licence holder, if requested. However, in the present case, neither the pursuer nor its agent requested disclosure (by the LSO or by the Board) of the content of the LSO report. The pursuer (in this case represented by an experienced solicitor) knew or ought to have known that the LSO was obliged, under statute, to submit a report on the review application; that such a report would, in all likelihood, have been submitted; and that the LSO was present at the reviewing hearing. It is artificial to suggest (as was stated by the pursuer's counsel) that, in some sense, the report was withheld from the pursuer. The content of the LSO report was freely available to the pursuer and its agents, if they had requested it. They did not avail themselves of that opportunity. Accordingly, no breach of principles of natural justice arises in the present case. In any event, given the neutral and uninformative terms of the LSO report, if there had been such a breach, it would, in my judgment, have been technical at best, with no material bearing upon the outcome of the defender's deliberations.
[66] Seventh, it was submitted that, in basing its decision to revoke, in part, upon the licensing objective relating to the protection of children, the defender had founded upon material that was not disclosed to the pursuer, and had thereby breached principles of natural justice. It is correct that the statement of reasons refers to the defender's "local knowledge" and to evidence presented to the defender at its "policy development evidence sessions", neither of which was explicitly referred to at the review hearing. Nevertheless, in my judgment, the submission is not well-founded for two reasons. Firstly, neither the "local knowledge" nor the evidence from the defender's "policy development evidence sessions" (which I take to mean nothing more than a source of that local knowledge) relates specifically to these premises. Instead, it is merely a general knowledge and understanding of local conditions. In this sense, the present case is distinguishable from the circumstances in Freeland, supra, where the Board was relying upon location-specific knowledge that had not been disclosed to the licence holder and upon which no opportunity had been afforded to the licence holder to comment. In contrast, in the present case, the general knowledge relied upon by the defender in the present case (i.e. that children may visit toilets unsupervised in licensed premises, notwithstanding licence conditions to the contrary) is the kind of knowledge and experience that is "...inherent in the nature of a Licensing Board and would be expected to be a normal part of its functioning" (Pagliocca v Glasgow District Licensing Board 1994 SC 561. It is not "specific knowledge" or "private information" particular to the premises or the parties, of which the rules of natural justice would require disclosure to the parties for comment before a decision was reached (Pagliocca, supra at page 566F-567A, distinguishing Freeland, supra.) Secondly, the fundamental issue (namely, that there was an alleged risk that children might visit toilets unsupervised in licensed premises, notwithstanding licence conditions to the contrary) can be seen to have been adequately ventilated and discussed at the review hearing. It was not a perceived risk or issue which materialised later, with no prior discussion, in the Statement of Reasons. It was the pursuer's agent who had introduced the issue by asserting that the premises were frequented by "children and families", that the premises were of a "community nature", community premises" and "not just a community pub but a meeting place"; and who had presented to the defender photographs of children and families in the premises (Transcript, page 38). In response, the Chairman specifically articulated a concern regarding the risk of children who:-
"... might wander into the toilets and find something and go 'I wonder what this is?'" (Transcript, pages 53 to 54).
The issue was raised in explicit terms; the pursuer's agent had the opportunity to address it; and she did so. No location-specific knowledge was founded upon by the defender. All that the statement of reasons discloses is the defender's general knowledge (which, on any analysis, is consistent with little more than common sense). In those circumstances, no breach of natural justice arises.
Decision
[67] For the foregoing reasons, I shall refuse the appeal.
[68] In their submissions, counsel agreed that if the appeal was refused the defender would be entitled to an award of expenses; if the appeal was successful on any ground other than the esto ground which was introduced by amendment at the outset of the appeal hearing, the expenses were to be awarded in favour of the pursuer; and in the event that the appeal was successful on the esto ground introduced by the amendment, the expenses should be reserved.
[69] As the defender has been successful, and in terms of the agreed position between counsel, I shall award the taxed expenses of process in favour of the defender.